November 29, 2013

A Woman Looks At a Woman's Relationship With Her Money

The following is a guest post from financial advisor, Luna Jaffe. Her insight on the particular concerns women have in relationship with money is worth your consideration

If you’re a woman, chances are good that in the years ahead, it will be you and you alone who’s responsible for managing your money. 

That could be a problem: Even among the very affluent, many women admit they know little to nothing about bigger-picture money concerns such as financial planning and investment management, according to a recent survey. “A lot of women cede those responsibilities to their husbands or partners because they say they don’t have the time, interest or opportunity to learn,” says Luna Jaffe. “Things are changing- more women are choosing not to marry or have been devastated by divorce or death of a loved one.  They recognize they can’t ignore money any more, but don’t know where to turn or who to trust.”

But even women with a net worth of at least $1 million concede they aren’t especially knowledgeable about money management. In the Women & Wealth Study sponsored by GenSpring Family Offices, only a third said they know a lot about financial planning, and 30 percent said the same for investment management. Part of the problem is that financial education is male-oriented, catering to how men’s brains are wired and what appeals to them, Jaffe says, “When we approach it creatively and from a more emotion-based perspective, women are not only drawn to learning about it, they have no trouble getting it,” Jaffe says.

She offers these three things every woman should know about their relationship to money:
• Your investment decisions are influenced by your emotional baggage. We all bring baggage into our relationships, and it’s no different with money, Jaffe says. When you’re not aware of the baggage operating quietly in the background, you may think you’re making smart decisions when you’re actually simply reacting to past experiences. And those might not have been even your own experiences! “Whether you or a loved one suffered the consequences of a bad financial investment, it can color your thinking in many ways, from destroying your confidence in your judgment to writing off all similar investments as ‘bad.’ ’’ Take time to reflect on the experiences you’ve had with investing, the decisions you made, and the conclusions you made as a result. What stories do you tell yourself because of these experiences?

•  Understand the emotional response with which you receive money, whether a paycheck, a gift or an inheritance. It’s important to receive money with grace – to savor it, to be grateful for it, to be at peace with it. But depending on the circumstances by which it arrives, and lingering emotions from past experiences, we sometimes receive money with anger, guilt, resentment, greed, entitlement or any of a host of other negative emotions. This can lead to self-destructive actions. Jaffe shares a story about receiving a small inheritance from her father at a time when she had no money. She loaned the whole sum to a friend, who promptly vanished. “I was still grieving his death, and I received money that represented his legacy, yet it was only a tiny fraction of his estate – his second wife got everything else. Deep inside, I felt ripped off. Perhaps I thought by loaning my inheritance, I could wash the confusion and grief out of the money making it clean and safe to use. ”

• Know your Comfort Zone for risk and stay within it. Investment comes with risks; you can assume a lot for potentially greater returns, or less for lower returns. Understanding your Comfort Zone and staying within it will help you stay committed to your financial plan. Would your best friend describe you as a risk taker? If you got $100,000 with instructions to invest it all in just ONE of these options – stocks, a savings account, a mutual fund portfolio of stocks and bonds, or your best friend’s start-up – which would you choose? Knowing whether you’re very conservative; happy with a little growth; comfortable with some ups and downs; or in for adventure will help you avoid taking financial advice that makes you uncomfortable.

About Luna Jaffe
Luna Jaffe is a Certified Financial Planner™ and Accredited Asset Management Specialist with more than 10 years of financial advising experience. She is the author of  “Wild Money: A Creative Journey to Financial Wisdom” and its companion workbook, “Wild Money: A Financial Field Guide and Journal,” (

I received no compensation for this post

November 27, 2013

Time for Thanksgiving and Family

The Thanksgiving holiday is a time for family, friends, and a heartfelt thanks for all our blessings. It is a time to enjoy a special meal, maybe a football game, sleeping late, and remembering how far we have come on life's journey.

It is a time for me to thank those who have viewed satisfying retirement blog almost one million times since it began in June of 2010.

It is a time for me to thank my regular readers.

It is a time to thank all those who leave comments, send me e-mails, or just let me know they are there.

It is time for me to turn off the computer and join the family.

A new post will be here on Friday.

Give thanks!


November 25, 2013

This Bird has Flown

This past weekend our youngest daughter moved her belongings and herself to a new apartment. After a little over two years living with us, her financial situation and employment outlook have improved enough to give her the confidence the time is right.

She has been a great roommate. We will miss her being part of our day-to-day life. She helped move us to healthier food choices and  to try different recipes.  She introduced us to movies, TV shows, and documentaries on Netflix we would have not tried on our own. She took over 1/3 of the housecleaning chores and more than half of the puppy care.

Speaking of Bailey, our cocker spaniel, she is likely to feel the most loss at our daughter's departure. Her whole 21 month life has been with a third person in the house, the person who takes her on walks, plays with her each evening, and has figured out how to get a very finicky puppy to eat dog food.

Our daughter has very strong feelings for Bailey, too. Living only 25 minutes away, I expect she will have to make a few visits each week for snuggle time with Bailey. I wouldn't be surprised if she gets her own puppy sometime next year. Dogs add a warmth and completeness to a home that few other creatures can.

The move does something else important: Betty gets her office and bathroom back. While we will reclaim a chunk of the backyard storage shed and space in the garage for both our cars, the loss of Betty's private space has been sorely missed.  Her computer, files, and craft projects have been squeezed into a small corner of our bedroom. Both of us have fit ourselves into the master bath, resulting in cabinets overflowing and towels hung over curtain rods.

Now, the process begins to put her office back the way she wants it and to move her lotions and potions into a bathroom that she had just finished redecorating when our youngest needed to come home. This rearrangement will probably take us through the holiday season. If she can be all settled by New Year's Day I think we will consider it a success.

We have all had to adjust through this period. In that regard it has taught all three of us a little extra patience and accommodation for others. It has strengthened our bond with our youngest and allowed her to get a new degree, find a new career path, and get her finances back in order.

And, it will be like moving to a new home when Betty gets all of her space back, we get our master bedroom emptied of the craft and computer stuff, and both cars will once again fit in the garage.

For all three of us, this is a perfect Christmas gift!

Betty's Office space is a blank slate

November 18, 2013

Retirement Advice: How is Retirement Different?

First posted nearly two years ago, these results are still intriguing and important to understand.

retirement, retirement planning

There are substantial differences around the world in what makes for a satisfying retirement. Here are some things to ponder:

* We tend to think retirement has been around forever, but that is not true. When America and other countries were primarily agrarian, there was no such concept. Farmers didn't stop working.  Likewise, unless a small business owner sold his operation and lived off the profits, most urban folks worked until too sick or old to continue. Then, family members supported them for the rest of their lives. Today a more formalized concept of retirement is a reality in most industrialized nations. But, what it means varies widely.

* In the U.S. 65 has long been the standard retirement age. Many other countries also settled on that age, too. But that is changing in response to budget issues and increased life spans. In Mexico the average person retires at 73. On the other end of the scale, the average Frenchman hangs up his or her work clothes around 59. The typical resident of Austria, Luxembourg, and the Slovak Republic also retire at a young age, while those in Japan and Iceland wait until their late 60's. Koreans average 71 as the time to stop their employment.

* Interestingly, the vast majority of those in a worldwide survey said they wanted to keep working well into their later years and didn’t feel that mandatory retirement was fair (80%). On the other hand younger people attempting to start their careers often complain of the older employees blocking their upward path. Initially retirement was often a product of government efforts to move older workers out of the workforce in order to free up jobs for the next generation. Suddenly that is not happening nearly as frequently.

* As several posts on this blog have noted, retirement may mean quitting one career just to start another. Many of those surveyed in the U.S., Japan, and Mexico see retirement as a chance to pursue a lifelong business dream or to gain additional financial stability. Risk-taking might be a habit of the young, but older people in America are no stranger to it. Whether it’s because they have the experience or the finances at hand, more and more older adults are starting businesses.

* For many, entrepreneurship might be setting them up for a different, more flexible work situation in retirement. For others, starting a business is simply a lifelong dream they want to fulfill before they’re too old to handle the stresses it might bring. Interestingly. a 2007 study actually found that around the world more older adults were providing support to relatives than were receiving it. That requires more money than may have originally been saved.

* Retirees in China, Hong Kong, and Brazil are more likely to value slowing down and resting in their retirement lifestyle than those from many other nations. Those folks are more likely to want to live off their their savings and investment money, spend more time with family, or simply slow down and enjoy life.

* In the U.S. there are lots places where retirees will have no problem finding other folks in similar situation. A whopping 19% of Florida's population is older than retirement age. That should come as no surprise, as the state is widely known for its large number of retirement communities. What may come as news is the state in second place: Pennsylvania. The Keystone state's population over 65 is 16%. Overall winner in this regard is Japan, where a full 22% of the population is 65+.

Not surprisingly, the world is graying at a rapid pace. By 2050 it is projected that seniors will outnumber children 14 and under for the first time in history. Over 2 billion of the world's citizens will be at least 65 years of age.

* Due to longer life spans and some pretty serious budgetary problems, nations around the world are attempting to raise the official retirement age when pensions can be collected. For those born after 1959 America has set 67 as the "full retirement age" to collect Social Security (not counting those who hold off until 70 to get higher benefits or those who start at 62 at a 30% discount). France had riots on its hands while trying to increase the age to 62 within the next 6 years. Great Britain has talked about the need to raise their official age from 65.

In contrast to the perception many hold about retirees, Satisfying Retirement holds as its central premise that we want to do whatever is required to help us stay happy and healthy. That may mean working later in life, it may not. Importantly, we should have that choice.

November 15, 2013

Going Back to Work After Retirement: Fact or Fiction?

A few weeks ago the Wall Street Journal had a special insert in the daily paper that dealt with retirement. It was entitled, Encore, Planning and Living The New RetirementI was quite interested in the results of the "So You Think You're Ready To Retire Quiz."  The responses to question #6 seemed to be a good one for this post.

The question asked, "What percentage of surveyed workers say they plan to continue working for pay in later life, and what percentage of current retirees say they have worked for pay?" 

The results mirrored what I found in my survey that is included in my book, Living a Satisfying Retirement. There is a significant difference between those who think they will earn money after retirement and those who actually do. 69% of pre-retirees figured they would be earning money from a job or profitable endeavor. Only 25% of those who are retired have done so.

That is a very important finding. It shows a real disconnect between wishful thinking or intent and reality. It exposes a serious gap in understanding that what you may want doesn't mean it can happen.

What causes this disparity and why does it matter? I can think of a few possibilities:

1) We tend to not acknowledge the inevitable effects of aging on our ability to get and keep a job. The reality is age discrimination, being over-qualified, health issues, or a simple lack of appropriate job openings can doom this strategy.

2) If someone "plans" on working again after retirement that may mean there is less incentive to save properly before retirement. The belief that "I can always get a job if money becomes tight" could give that person an unrealistic feeling of security.

3) Once retired someone is much less likely to want to give up the freedom and control over time that comes with a satisfying retirement. The thought of getting back into that world hold little attraction, regardless of the monetary benefits.

4) With retirement often comes a scaled down lifestyle. Until then, predicting the amount of money needed is just an estimate. Once retired, the need to generate more income may not exist. A simplified and less consumer-driven lifestyle can be supported without going back to work.

Of course, there are two situations where this survey is meaningless:

a) to someone who has not saved enough or through unforeseen events must continue working or find something, anything, after primary employment has ended.

b) to someone whose life circumstances change dramatically enough after retirement to force a change in attitude. A major health problem for a spouse, the need to help support a child, or even raise grandchildren can make working after retirement essential.

My suggestion is you take some time to realistically analyze your post-retirement employment status: its likelihood, its motivation, and its costs to your retirement lifestyle. There is no right or wrong choice but it is important to understand why something is happening.

November 13, 2013

Take Us On a Tour

Two months ago I wrote about how I enjoy living like a local when I travel. Instead of following the same schedule, eating the same foods at the same chain restaurants, and sticking to only the tried and true tourist spots, I try to adapt as much as possible to my new environment. Actually, that is one of the nice things about RV travel: to be in unfamiliar places and try to figure out what makes a place tick.

Several readers commented that they enjoy showing visitors around their home town. Reader Mona, said, "when my pen pal of 40 years from England came to visit and I saw my local area through their eyes - the history, the attractions, the rolling river hills and trails. I gained a new appreciation for my "homeland."   Mona's experience is not at all unusual. Quite often someone will tell me they have never visited some of the sights that tourists pay good money to see.

Reader Linda added, "In my career as a postmaster in a small town, I  would have "tourists" come in and ask me advice for what there was to do in the local area that was interesting, historic, scenic or fun. It was flattering that they trusted my advice. But, also, it made you appreciate the beauty and interesting things where you live."

So, this discussion created the perfect premise for a good post: tell us what you would show someone who was visiting the area where you live. Where would you be sure to them? What is on your must-see list? What makes where you live special? This is your chance to blow you town's horn.


Small town or big city, famous sites or places off the beaten path....take us on a tour of your home.


To help get you started, I'd be sure to take Phoenix area visitors to:

1) Taliesin West. Frank Lloyd Wright's winter home for 20 years

2) South Mountain. The hiking and views of the city are spectacular

3) Scottsdale 5th Ave and Waterfront shopping area. Beautiful

4) Lunch at the Hyatt Gainey Resort. For my money, the prettiest of all the resorts in the area.

5) Desert Botanical Gardens. Would give you a new appreciation for the beauty of desert planting.

.....and, if enough time, Sedona and the Red Rocks. A sight that everyone should see at least once in a lifetime.

Rest assured that I will keep all the ideas and use them when Betty and I visit your hometown sometime on one of our RV trips. We have just started planning our 2 month trip next summer. Now is the perfect time to get us to take a side trip to you!

November 11, 2013

Hope For The Written Word

The closing of bookstores, the fact that Amazon now sells more e-books than printed ones, and the tendency of youngsters to choose video games, cell phones, or tablets for entertainment makes someone who loves the printed word shudder. Within my lifetime I have seen a dramatic shift away from personal communication and intimate conversation to mass media, mass interaction, and impersonal communication (texting, et al).

As a book lover I sometimes wonder who will be the last person to turn off the lights at the last remaining print bookstore in America. While I don't suppose that means the end of civilization as we know it, it would be a devastating loss for our species.

For the past few years I have seen a glimmer of light, and hope, huddled in the corner of a house in Gilbert, Arizona. My grandkids live there, with my daughter, their mom, and my son-in-law. Mom was dyslexic and had to spend hours a night during her high school and college career struggling through her text books.

Even so, or maybe because of that, she and her husband have instilled a love of books and reading in their children that gives me hope that all is not lost. Certainly there are other moms and dads teaching their children the power and importance of the written word and the irreplaceable power of a book to transform, to transport, and to empower someone.

My grandson just turned seven. Because the month of his birth is so late in the year he is one of the older children in his first grade class. But, that has little to do with what I want to share with you. Since he was barely three years old he has been reading in some form or another. Very early on, he was directed to books instead of video games or endless hours of television.

Now, in the first grade, he is reading at a fourth or fifth grade level. He reads 100 page books in two days, retaining everything, and anxious to share the plot and excitement of his latest book. His very first choice before bed is to read. He can tell you exactly, down which aisle, on which shelf, and the position on that shelf, where the book is located in the library.

Not to be outdone, his sister, now in Kindergarten, devours the written word just as intently as her big brother. She is reading at something close to a second grade level. Bedtime will find her choosing something to read, or have read to her, before she falls asleep.

Amazingly, the third granddaughter is only three. She is now asking her mommy, "What are those letters? Tell me what those letters say." So anxious to join the fun she can't wait to learn what combinations of letters mean. Is there any doubt she will follow brother and sister's path?

Mom takes the three kids to the local library every three weeks. They check out the maximum allowed limit of 50, yes, fifty books. Every 21 days they return the 50 books, all read and enjoyed, and check out another 50.

This absolutely all consuming interest in reading and all things books was brought to my attention again, on Halloween evening. Betty and I had just helped mom take the three kids around the neighborhood to collect their candy, while dad stayed home to greet the ghouls and goblins who came to their door.

After returning home, sorting through the candy, and allowing each child to choose one piece from the stack, the three trudged off to the bathroom for toothpaste and face washing. Then, without another word, all three retreated to their rooms, picked up a book and began their nightly ritual. There was a 2 foot stack of candy 40 feet away, yet they knew the rules, and so happily chose to end that day with a book.

Just so you don't think these kids are somehow locked away from the real world, my grandson loves Iron Man. He can assemble 350 piece Lego games almost as quickly as the pieces come out of the box. He loves football and is now becoming fascinated by detectives. He loves technology. In his classroom iPads are provided each child for lessons in math, science, and language. In short: he is a normal boy. 

The middle daughter is a budding artist who already has a strong grasp of colors and design. She loves to dance and will twirl whenever she is happy.  Her little sister will do anything and everything big brother and sister do. She is fearless, enjoying nothing more than leaping on my lap or running around the backyard in some manic game of hide and seek.

These three young children will not reverse the world's turn away from the printed word. But, it makes my heart swell with joy when one of them (or all three at once) ask to read me a book or have me tell them a story.  That is one of the best parts of my satisfying retirement.

There is hope.

November 8, 2013

My Medicare Decisions Are Only A Few Months Away

In May of next year I will be eligible for Medicare, something I have been eagerly awaiting for the last several years. Being on the individual health care insurance market has meant yearly 15-18% increases, year after year. As reported a few weeks ago, I did purchase a policy under the Affordable Care Act that will save me $767 from January through April. Then Medicare starts on May 1st.

Because I am already receiving Social Security payments, I will be enrolled automatically when I turn 65. But, there is more to do if I want more expenses covered and a prescription drug plan. So, I have a lot of homework to do. I have some important decisions to make:

1) Will I stick with traditional Medicare or opt for an Advantage plan?
2) Will I buy Part D coverage for drug coverage?
3) Will I buy a Medicare supplemental plan (Medigap) that covers most of the 20% that Medicare doesn't?

Each choice brings with it a potentially large differences in cost, coverage, and health care.

What follows is what I have been able to determine from many searches on the web. While is very helpful, it is only one of dozens of sites I explored. Considering how complicated it can become I am pretty sure I have some of the details and averages wrong or incomplete. I expect you to help me by setting me straight!

Traditional Medicare will cost $104.90 in monthly premiums in 2014 (unchanged from 2013). That covers Medicare Part A which is for inpatient hospital care, skilled nursing care, hospice care and other services. Part B covers doctors' fees, outpatient hospital visits, and other medical services and supplies that are not covered by Part A.

On average Medicare pays 80% of the costs generated by Part A or Part B services. I would be responsible for the rest. There is a $147 deductible for Part B that must be satisfied before Medicare pays anything. There are also copays to consider if the doctor I use doesn't accept what Medicare pays as the full amount.

Advantage plans (Medicare Part C) are plans approved by Medicare but run by private companies. They cover everything Medicare does plus offer extra services that include drug, vision, and dental coverage. Many of these plans offer $0 monthly premiums, $0 deductibles, and $0 copays. How do they make money? These companies are paid by the federal government to handle what Medicare usually covers as well as provide them with a reasonable profit.

Restrictions on these "free" or low-cost plans are substantial and must be approached very carefully. If someone is in good health and takes few drugs it may be one's best choice. It is easy to switch plans once each year (even back to original Medicare) if health issues begin to crop up or special care isn't covered by one's current plan.

Then comes the issue of Medigap coverage. These policies cover what Medicare doesn't. Often called supplemental policies, they average around $165 a month. Depending on the type of Medigap policy purchased and how old you are when you buy it, your monthly premiums will either remain unchanged or increase each year.

From what I can find, purchasing a policy that covers Part D (drugs) seems to average around $10-$15 a month. I pay a percentage of each drug cost in addition to that. More expensive drugs will mean substantial out-of-pocket expenses but nowhere close to what the cost would be without insurance coverage. There is also a deductible of just over $300.

Of course, I can't forget about the famous "donut hole" when I think about my costs. When Medicare drug coverage was added in 2003 there was a gaping hole in coverage for those who needed it the most: those who required expensive drugs were forced to pay the full cost when they could least afford it.

The Affordable Care Act finally addressed this situation: the donut hole will close completely in 2020. In the meantime it is shrinking. From what I can determine after roughly $2,900 of drug costs in a year I will pay a higher percentage of drug costs until I leave the coverage gap somewhere around $4,500 (it changes each year). After that I pay only about 5% of any additional drug costs. 

So there I am. I still have the same three questions I had at the beginning of this post, but I think I am closer to answers. The next step will be finding exact pricing and coverage for each of my options and then looking at my budget for next year.

Wish me luck, and let me know what I have missed or have incorrect above.

Some friends forwarded the links below, suggesting I and my blog readers might find them helpful.

November 6, 2013

Retirement Advice: 5 Ways I Could Streamline My Day

A few weeks ago I shared my RV trip frustration over sporadic Internet service. After many anguished hours I finally realized connecting to the Internet is not worth ruining the precious time I get to spend on the road with my wife and lovable dog, Bailey. I promised myself to keep my priorities in proper order: important stuff first, unimportant stuff whenever!

That got me to thinking of a few other ways I have attempted to stay focused on ridding my day of  unimportant concerns. These simple suggestions have been offered by readers over the years and continue to resonate with me...maybe with you, too. I will note that I struggle with two of these every single day.

1) Don't read e-mails, blog comments, or social media threads first thing in the morning. This is an excellent suggestion, and one I cannot bring myself to implement. Try as I might I grab the laptop first thing every morning to check on blog comments, e-mails, and top news stories, sometimes before I even get a cup of coffee.

Now that the weather is finally cooling off here in the desert maybe I can at least have breakfast on the back porch before I plunge back into the Internet. No promises, but I'll try.

2. Cancel any magazine subscription if it sits unread for more than 60 days. Here is a de-clutter suggestion I have been able to implement. From a dozen magazines we are down to four. They are read within two weeks of receiving them and then recycled.

3. Set smartphone to only update feeds every 2 or 3 hours instead of every 30 minutes. This is so simple to do. I know exactly where the setting is. But, three hours? That is a lifetime! At least I have turned off the notification sound so every time I get a new email a beep or blurt doesn't announce the fact. I have been known to go a full 45 minutes without checking the inbox.

4. Don't attend club or organization meetings just because you think you are "supposed to." I have gotten much better with this. Over the last several years I have stopped going to a club that no longer interested me, eliminated a weekly men's gathering, and given up one volunteer activity that had become unsatisfying. I had been doing it so long I was stale and not performing my function well.

5. Group errands together. Try for no more than 2 days a week. I do pretty well with this one. In fact, I celebrate when I go an entire day without having to leave the house in a car. Where we live it is relatively easy to plot out a route that allows me to hit various stops as I follow a circular route, taking care of a chore at each location. I used to make a separate run to the library, then decide later I needed to go to the bank, and then Home Depot had a needed something. Now, those three make a perfect loop so all are done in one trip, saving me several miles and probably 40 minutes of wasted driving.

I will make a valiant effort on #1 and #3 above, but will not stress out if I fall short. After all, a satisfying retirement really is a work in progress.